Issue Brief 23-06
April 14, 2023

UPDATED 04/14/23: A calculation error in the clawback multipliers has been corrected, adjusting the clawback payments for CY 2024 downward slightly.

The Centers for Medicare & Medicaid Services (CMS) announced the parameters that will guide calendar year (CY) 2024 individual and state costs for the Medicare Part D drug benefit. CMS projects a 6.42% increase in per capita Part D expenditures. However, after accounting for prior-year revisions, the annual increase is 8.01%.

In addition to significant Part D expenditure growth, states will see higher clawback costs in CY 2024 due to the December 31, 2023, termination of the temporary Federal Medical Assistance Percentage (FMAP) implemented in response to the COVID-19 public health emergency (PHE).

FFIS estimates that CY 2024 clawbacks will cost states almost $19 billion, an 18.8% ($3 billion) increase from CY 2023.